Plunging commodity prices have killed off an $872 million takeover of engineering firm Bradken.
The cast iron and steel products supplier said steep declines in oil and iron ore prices have made it difficult for Pacific Equity Partners and Bain Capital to fund a takeover.
Negotiations have therefore ended, and Bradken shares plunged to their lowest price in almost six years, losing $1.47, or 35.8 per cent to $2.64.
"The recent volatility in global commodity and financing markets has impacted the consortium's ability to obtain financing on terms acceptable to the consortium," Bradken said.
This is just another development that will rattle investor confidence in the mining sector, Morningstar senior equities analyst Ross Macmillan said.
"It raises concerns about just how fragile the market is at the moment," he said.
"Bradken supplies mining consumable products to a lot of iron ore mining companies, and now they're facing financial difficulty.
"It shows that there won't be that demand for Bradken's products over the next two to three years."
Bradken cut about 500 jobs in a major restructure in the 2013/14 year, and its profit dropped 68 per cent amid lower revenue from its mining products, mineral processing, rail and engineering divisions.
Volatility in the company's markets has recently increased as oil and iron prices fell, Bradken said in Wednesday, and there are no visible signs of a turnaround.
Mr Macmillan said Bradken may now reconsider an equity raising it had contemplated before the takeover bid was made in December.
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